After four years of Donald Trump, will a change in who occupies the Oval Office have a major effect on the seed industry? We get a U.S. perspective.
Transitions in the White House come at the same time every four to eight years, and 2020 was no different. In November, the United States popular vote and electoral college voted President Donald Trump out of office, and he will be replaced on Jan. 20, 2021, by Joe Biden.
While transitions can be new and exciting, it also leaves a lot of doubt and questions about the future. What new policies and regulations might come into play? Who’s going to be in Biden’s cabinet? And most importantly, what does this mean for the seed industry?
Trump’s China Deal
When it comes down to it, one of the biggest questions surrounding a Biden administration is Biden’s stance on trade, says Mary Kay Thatcher, senior lead of Syngenta’s federal government relations wing.
“I think trade will change drastically. I believe Biden will be very pro-trade, but I don’t think trade will be at the top of his priority list. Instead, he might hit on domestic issues, be it fixing or trying to fix COVID or the stimulus bill.”
Thatcher notes that in particular, a Biden administration might mean going back to more traditional trade deals.
“Before President Trump, we always did trade in this country by engaging our friends. Once we had a group together, you’d then move somewhere like China or Russia or wherever to see if we could seek some changes.”
Michelle Klieger, president of Stratagerm Consulting, notes that this was common, especially under the Bush and Obama years.
“There were a lot of bilateral talks set up between different parts of the U.S. and Chinese governments,” Klieger says. “Debatably, did they cause structural changes in the U.S.-China relationship? Maybe. But probably not as much as people hoped.”
She says that all-in-all, that means when new presidents came into office, China was already on their toes, expecting the U.S. to make trade a priority.
“China knew that this big trade talk was coming from one of these committees or there was going to be a high-level visit, and suddenly, there would be a flurry of activity on the Chinese side,” Klieger says. “We would see biotech approvals and we’d see other things that the U.S. had been pushing for. It was almost like, ‘We’re going to do this big, showy thing,’ and China would give a few things we wanted. But it didn’t structurally change the trade process.”
However, Thatcher notes that wasn’t quite Trump’s style when he came into office.
“Trump felt strongly that we were the largest economy in the world, so arguably, we should really be able to go into trade agreements on our own,” she says. “And then, we wouldn’t have to negotiate with other groups first.”
Klieger agrees that Trump took the complete opposite stance after seeing that there wasn’t any structural trade change after these meetings.
“Instead, Trump’s response was to use these tariffs,” she says. “And so, the question became over the last four years — were these tariffs and trade deals more incremental or did it cause structural change? I think in phase one, there was still a lot of restoring the status quo before the tariffs. Phases two and three were supposed to be those structural changes, but we’ve now run out of time for them.”
Klieger notes that it’s hard to see which method — bilateral talks or a direct-to-China discussion — was more effective in the long run.
When it comes to speculating on Biden’s future with trade and China, Thatcher says she doesn’t think Biden will simply do away with it.
“While Trump prides himself as being the Tariff Man, I don’t think that’s Biden’s M.O.,” she says. “I anticipate that he will attempt to reduce some of the $360 billion of tariffs that are in place, but he’s not going to do it for the heck of it. He’s going to want something in return, and I don’t think we know what that is yet.”
Thatcher says Biden could want a few things that haven’t been accomplished yet, ranging anywhere from making the purchases they’ve agreed to all the way to reducing the amount of time it takes for biotech to get approved in China.
Klieger believes that while Democrats have historically been harsher on China than Republicans, we might actually see some stability with the U.S.’s relationship with China.
“I don’t expect it to get much better, but it is possible we’ll expect it to get more stable,” Klieger says. “I don’t think that the economies are going to become more intertwined. I’d expect to see more cooperation between the United States and Europe, between the United States and Japan, and just in general to more of our allies.”
Incentives and Cabinet Positions
When it comes down to the idea of farmer incentives, both Klieger and Thatcher wonder if the potential for cover crop seed incentives will be available in a Biden administration. Both say that one thing’s for certain: climate change is high on Biden’s priority list.
“Biden has been really open about the fact that he’d like to spend $2 trillion on climate change incentives,” Thatcher says. “However, it really depends if the democrats win both seats in Georgia, and therefore, control the Senate.”
Thatcher believes that even if Republicans have the Senate majority, climate change will still be on the table, but the incentive money would be nowhere near the $2 trillion Biden has suggested.
Klieger says a big factor is how a program like this would be introduced: would it be an incentive-based program or a regulation?
Just prior to press time, Biden announced that he has picked Tom Vilsack to be his agriculture secretary, replacing Sonny Perdue.
Vilsack served as agriculture secretary under the Obama administration.
“We are very pleased to hear of President-elect Biden’s intention to nominate Secretary Tom Vilsack to serve as his Secretary of Agriculture. Under President Obama, Secretary Vilsack demonstrated a strong understanding of the important issues impacting the American seed industry and the broader agriculture community,” says American Seed Trade Association President & CEO Andy LaVigne in a statement.
“Agriculture, and specifically the seed industry, will continue to play a key role in driving innovative solutions to help meet pressing global challenges, from climate change to food security. Success will require strong collaboration throughout the agriculture and food value chain, as well as robust private-public partnerships to further advance agriculture research and promote a continued environment of innovation for the future. We look forward to working with Secretary Vilsack and the Biden administration moving forward.”
